ADB offers $165m for private sector infrastructure development
Tuesday, 21 October 2008
FE Report
Asian Development Bank (ADB) will offer US$165 million fund to Bangladesh's private sector for infrastructure development, particularly power generation, an official said Monday.
A deal will be signed today (Tuesday) with the ADB for the loan, which will be disbursed to the private sector through the government's private sector lending arm Infrastructure Development Company Limited (IDCOL), a senior economic relations division (ERD) said Monday.
"IDCOL will disburse the loan to the private sector mainly for infrastructure development, especially for power generation and for improving the renewable energy in the country," he told the FE.
The official said the Manila-based donor agency has been pressing the government to end its monopoly in power generation and encourage the private sector to invest in infrastructure development.
The government established IDCOL in 1997 as a public sector financial institution aiming to bridge the financing gap for developing medium and large-scale infrastructure and renewable energy projects in Bangladesh.
It has already provided financial support to some private companies for setting up some power plants and solar-based energy generation system.
IDCOL has disbursed term loan worth Tk200 million to the Malancha Holdings Limited for setting up a 35-megawatt (MW) power station at Dhaka Export Processing Zone (DEPZ).
The financial institution has also approved Tk 500 million term loan for installing 110MW capacity power plant by the country's leading private sector power generator, Summit Power Limited.
The ERD official said: "The ADB is now pursuing the government to encourage the private sector for setting up the power units to strengthen the energy sector and ensure energy security in the country."
The electricity supply situation has been deteriorating over the couple of years as the government has failed to generate adequate power against the growing demand in the country.
The power generation has dropped to about 3200mw-3600mw per day in recent time leaving more than 1200MW shortfall.
Out of total 5245MW installed capacity, the private sector has a capacity to generate 1260MW of electricity daily.
IDCOL will provide the $165 million fund to the private enterprises for developing small, medium and large infrastructure projects, especially power projects, and promotion of renewable energy like solar home system and biomass installation in rural areas.
Of the loan, ADB will provide $82 million through its hard-term wing-- ordinary capital resources (OCR) -- and the rest $83 million from the soft-term wing --Asian Development Fund (ADF), the ERD official said.
Asian Development Bank (ADB) will offer US$165 million fund to Bangladesh's private sector for infrastructure development, particularly power generation, an official said Monday.
A deal will be signed today (Tuesday) with the ADB for the loan, which will be disbursed to the private sector through the government's private sector lending arm Infrastructure Development Company Limited (IDCOL), a senior economic relations division (ERD) said Monday.
"IDCOL will disburse the loan to the private sector mainly for infrastructure development, especially for power generation and for improving the renewable energy in the country," he told the FE.
The official said the Manila-based donor agency has been pressing the government to end its monopoly in power generation and encourage the private sector to invest in infrastructure development.
The government established IDCOL in 1997 as a public sector financial institution aiming to bridge the financing gap for developing medium and large-scale infrastructure and renewable energy projects in Bangladesh.
It has already provided financial support to some private companies for setting up some power plants and solar-based energy generation system.
IDCOL has disbursed term loan worth Tk200 million to the Malancha Holdings Limited for setting up a 35-megawatt (MW) power station at Dhaka Export Processing Zone (DEPZ).
The financial institution has also approved Tk 500 million term loan for installing 110MW capacity power plant by the country's leading private sector power generator, Summit Power Limited.
The ERD official said: "The ADB is now pursuing the government to encourage the private sector for setting up the power units to strengthen the energy sector and ensure energy security in the country."
The electricity supply situation has been deteriorating over the couple of years as the government has failed to generate adequate power against the growing demand in the country.
The power generation has dropped to about 3200mw-3600mw per day in recent time leaving more than 1200MW shortfall.
Out of total 5245MW installed capacity, the private sector has a capacity to generate 1260MW of electricity daily.
IDCOL will provide the $165 million fund to the private enterprises for developing small, medium and large infrastructure projects, especially power projects, and promotion of renewable energy like solar home system and biomass installation in rural areas.
Of the loan, ADB will provide $82 million through its hard-term wing-- ordinary capital resources (OCR) -- and the rest $83 million from the soft-term wing --Asian Development Fund (ADF), the ERD official said.